Crowdfunding: The Conclusion
On Tuesday, September 6th five boxes of books—paper and hardback— arrived on my doorstep. Five boxes full of a book that could only exist thanks to the contributions of seventy-two patrons, people who backed a crowdfunding campaign I held back in May of 2016.
Months of preparation led to the point when I held the book I’d written, re-written, edited, proofed and proofed again, in my hands. Pre-campaign I put in hours of work for three months. The campaign itself — a month of highs and lows, swings and round-a-bouts — raised enough funds to cover the cost of the next three months, when I would turn a manuscript on my computer into a solid, printed book.
This is the third in a three-part blog series on what I learned from doing a crowdfunding campaign. My aim is to give insights you might not otherwise find in the online articles about crowdfunding. I want to get specific when I can, and go beyond ‘if you build it, they will come’ (since that’s fundamentally untrue when it comes to crowdfunding).
The first article goes over the preparation involved to ensure, when the campaign launches, you will have backers and support. The second article examines the campaign itself — specifically how the hard work involved is due to how unpredictable and emotionally intense crowdfunding is. In this, the third article, I talk about post-campaign activities, when the funds are in, and the work is All Down To You.
To begin: crowdfunding income is income. It’s gonna have to be declared wherever you live, whatever your taxes are like. There’s a lot of information out there about researching taxation of crowdfunding income specific to where you live, but most of these articles are written by people living and paying taxes in the United States.
As I write this, I’m still not 100% sure on the details, but there is every possibility that I will have to file a US tax return alongside my Canadian one since the income was generated through an American-based company. This is why one of the fundamental steps post-campaign is:
Get an Accountant
And when I say get an accountant, I mean a properly trained personal accountant. This is not going to be a task for H&R block.
Crowdfunding income is still a very new thing, and that means there isn’t clear information about how it should be declared. Details will vary from country to country and change from month to month. You’re going to want someone who really knows their stuff and can get the most accurate and up-to-date information, so you’re not at risk of an unaffordable tax bill at the end of the year.
Save all your receipts, digital and otherwise. Get an envelope, create a secure file on your computer, and account for every dollar raised and every dollar spent and in which country.
And note, while Canada and the UK have an April to April tax year, the US has a January to January one. This is another fun layer to add to an already complicated form of income. But that’s okay. This is why accountants exist. Leave it to the experts.
What happens next all depend on the product, which is why it’s vital that you:
Have a timeline!
You’re your own boss right now, and your backers are your investors. Once the funds are in it’s down to you to deliver the product people have paid for. You’ll have given them an idea pre and during the campaign, so post-campaign you’re going to want to tighten the timeline up and check in with it regularly.
Being realistic is important. You’ve probably never done this before. You can estimate how long something will take, but it might take longer than expected, while other things will be much quicker.
This is why it’s also important to:
Be flexible and have a backup plan.
I was mostly self-reliant once the campaign was done, but I was working with an editor. We had regular communication so we both knew where the other was at, and all the editing was done through Google Docs, making it super flexible for both of us to make changes to the manuscript.
But life happens.
A lot came up for my editor in a very short span of time, right when we were in the final proofing stage, and I was getting ready to lay the whole thing out. The timeline slipped by five days, which was stressful and worrying, but workable.
We had a contract, so I terminated that under the agreed terms, something that meant there was no drama or personal upset for either party. We had a professional agreement, my editor wasn’t able to deliver, I paid what was owed based on the work that had been completed and then I could move on.
I got Grammarly set up on my computer and ploughed through proofing and layout, making up three days time by putting in long hours. Then, when I’d ordered the print proof, I took a PDF printout of the manuscript to someone else for one final proofing.
The whole thing worked out really well in the end.
I saved money on the proofing stage that I was able to put towards having the book converted into an ePub, I got excellent feedback on the finished manuscript from someone who had not seen any of the previous drafts, and the timeline actually moved up. I was able to order final copies of the books for fulfilment two days earlier than I’d originally planned!
This was a bonus for my backers, and exciting news for them to get. Which brings me to the next important thing to remember post-campaign:
Communicate with your backers!
At the end of each month, I send out a monthly-wrap up of All The Things — blog posts, podcasts, art, etc. I’ve been doing this for some time and didn’t want that email to conflict with updates to my backers, nor for me to have too much on my plate for the 30th or 31st of each month, so I chose to send progress updates to my backers mid-month, every month.
I didn’t always have a lot to say, maybe no more than ‘Still editing!’, but, from experience, knowing is just much better than wondering. I’ve backed a few crowdfunding campaigns, and I appreciate the ones that drop a line every so often. It’s reassuring, and a friendly way to touch base so no one thinks you may have taken the money and run!
And finally:
Do the prep work.
While I was waiting for the print proof to arrive I ordered business cards, envelopes and art print, and picked up ‘thank you’ cards. A week later, when I was waiting for the final books to arrive, I wrote all the thank you notes, addressed the envelopes and prepped all the contents of each package.
When the books arrived, I was able to sign them (as needed) and get them in envelopes and ready for posting in one afternoon.
If I’d waited on any of this until after the books had arrived, I’d be in a panic right now, instead of having the time to write this blog post!
While the books are now on their way to backers all over the world, things are far from being over for this book. There’s a two-month marketing campaign before the book is available to the public. I’ve got bookstores to contact, interviews to do, and invitations for the November 9th book launch party to send. But as far as the crowdfunding side of things goes, I’ve come to the conclusion.
It’s been a ride—one that wasn’t possible not so long ago. Crowdfunding is an exciting economic development. It’s an opportunity for the artist/creator/designer to apply directly to their audience for support, cutting out a multitude of middle-people who usually dominate and control any given industry. It’s all very socialist and fun, albeit a bit of a headache at times. I can’t say if I’d do one again anytime soon but it’s a platform that works, and if there is a second time, I’ll be able to do it that much better.
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Originally published on Medium